The past few months brought some worrying economic news, mostly about the deteriorating situation in China. This also genereated increasing concerns about the outlook for the European economy. However, recent data suggest the economic recovery in the Eurozone is holding up quite well.
Business confidence in the Eurozone continued to improve in October. The combination of low interest rates, low commodity prices, a weak euro and strengthening housing markets is keeping the recovery on track. At least for now, Eurozone business leaders are not all that bothered about the news out of China, even if some temporary Q3 weakness cannot be excluded.
In this respect, the Belgian economy is a nice case in point. Economic growth slowed down in Q3, most likely because of weaker manufacturing activity. That said, improving business confidence suggests the economy is picking up again in Q4.
On a related note, signs of continuing recovery raise some question marks about the remarkable candidness of ECB-president Draghi about his plans to add to monetary stimulus in December.